Quietly Petroleo Brasileiro Petrobras (PBR, quote) has become one of the hottest stocks in emerging markets. Bank of America Merrill Lynch upgrade today, Credit Suisse reiterates “outperform” and some real tangible output in the first quarter to get to the positive side.
Cost cutting remains a delivery point for investors (1.3bnR in savings in Q1) where there have been few over the years.
Petrobras is still 10% of the IBOVESPA and under owned is still very cheap. First quarter numbers were very good with adjusted EBITDA of R$16.2bln (+13% consensus) and Net Income R$7.7bl n (+10% cons) second quarter is expected to show more price improvement, better ethanol mix and more divestitures that help the balance sheet.
